Car hire in Iceland

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Car hire on Iceland

Tips for a cheap rental car

Getting a rental car is without a doubt the best way to experience Iceland and all its amazing nature. With a hired car, you’ll be able to see many exciting sights and gorgeous scenery that would otherwise be inaccessible.

During high season, which is usually said to last from June until August, there is high pressure on car rental companies. It is, therefore, a good idea to book your rental car online in advance. By booking online early, you will also get a better price as car hire on Iceland can be quite pricey during high season. At low season, renting a car is usually cheap, but you may find that many of the roads will be closed.

If you want to drive a lot inland, it is recommended that you rent a four-wheel drive as the roads are quite tough.


For car hire on Iceland, certain rules and requirements apply:

  • You must be 20 years old and have had your driving license for at least a year. This age limit may vary depending on the type of car you’d like to hire. Check with your chosen car hire company to find out exactly what rules apply for you.
  • You must have a valid Visa or MasterCard.
  • If you are under 25 years, you will probably be charged extra.

Add-ons at booking

Should you want extra equipment in the car, e.g. a GPS or a child car seat, it is recommended that you add this already when booking your rental car. This will, in turn, facilitate the pick up of the car and ensure that the equipment is available on site.

Many of the roads on Iceland are very small and narrow. Using a GPS is recommended. A GPS will also be able to tell you the road surface condition, which, on Iceland, is very important information.

Please note that by Icelandic law, children under 3 years or shorter than 150 centimetres are required to use a fitting child car seat.

Driving on Iceland

Renting a car and driving on Iceland is generally a very nice experience. The driving pace is comfortable and the roads are not too heavily trafficated. During the summer months and high season there will be slightly more traffic, but during the rest of the year you’ll find the roads calm.

The road system in the inland parts of Iceland is not particularly widespread. The main highway “Riksväg 1”, however, goes around the whole island. Driving this highway at reasonable speed takes about a week, including overnight stops.

If you want to explore the inland it is important that you check in advance which roads you’d like to use and in what condition they are. Many of the inland roads are unpaved dirt roads that are at risk of being flooded, which makes them very hard to drive on. Also be aware that meetings with oncoming traffic can be hard, and that cattle and Icelandic horses can be walking freely on the roads. Please note that it is not recommended to drive a two-wheel drive in the inner parts of Iceland.

Below you’ll find a list of a few Icelandic traffic rules to be aware of:

  • Talking on the phone without the use of a hands-free is prohibited.
  • It is illegal to drive outside the roads or outside marked trails.
  • You must yield to all trafic on primary roads.
  • The speed limit on unpaved roads is 80 km/h.
  • The Hvalfjörður tunnel (Icelandic: Hvalfjarðargöng) is the only toll road on Iceland.